Vesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power andisaw. Each handisaw sells for $34. Wesley expects the following unit sales: January February 2,600 2,800 3,300 3,100 2,500 March April May Vesley's ending finished goods inventory policy is 25 percent of the next month's sales. Suppose each handisaw takes approximately 0.60 hour to manufacture, and Wesley pays an average labor wage of $24 per hour. Each handisaw requires two plastic components that Wesley purchases from a supplier at a cost of $3.50 each. The company has an ending direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the lastic components total $4.50 per handisaw. Manufacturing overhead for this product includes $73,800 annual fixed overhead (based on production of 27,000 units) and $1.20 per nit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed t $18,000 per month. Required: Compute the following for the first quarter: Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. 1. Budgeted Sales Revenue 2. Budgeted Production in Units 3. Budgeted Cost of Direct Materials Purchases for the Plastic Housings 4. Budgeted Direct Labor Cost $ $ January 88,400 2,650 $ 38,160 $ February 95,200 $ 2.925 42,120 $ March 112,200 3,250 1st Quarter total $ 295,800 8,825 0 127,080 $ 46,800 $
Vesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power andisaw. Each handisaw sells for $34. Wesley expects the following unit sales: January February 2,600 2,800 3,300 3,100 2,500 March April May Vesley's ending finished goods inventory policy is 25 percent of the next month's sales. Suppose each handisaw takes approximately 0.60 hour to manufacture, and Wesley pays an average labor wage of $24 per hour. Each handisaw requires two plastic components that Wesley purchases from a supplier at a cost of $3.50 each. The company has an ending direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the lastic components total $4.50 per handisaw. Manufacturing overhead for this product includes $73,800 annual fixed overhead (based on production of 27,000 units) and $1.20 per nit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed t $18,000 per month. Required: Compute the following for the first quarter: Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. 1. Budgeted Sales Revenue 2. Budgeted Production in Units 3. Budgeted Cost of Direct Materials Purchases for the Plastic Housings 4. Budgeted Direct Labor Cost $ $ January 88,400 2,650 $ 38,160 $ February 95,200 $ 2.925 42,120 $ March 112,200 3,250 1st Quarter total $ 295,800 8,825 0 127,080 $ 46,800 $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Urmila ben
Transcribed Image Text:Wesley Power Tools manufactures a wide variety of tools and accessories. One of its more popular items is a cordless power
handisaw. Each handisaw sells for $34. Wesley expects the following unit sales:
2,600
2,800
January
February
March
April
May
Wesley's ending finished goods inventory policy is 25 percent of the next month's sales.
Suppose each handisaw takes approximately 0.60 hour to manufacture, and Wesley pays an average labor wage of $24 per hour.
Each handisaw requires two plastic components that Wesley purchases from a supplier at a cost of $3.50 each. The company has an
ending direct materials inventory policy of 20 percent of the following month's production requirements. Materials other than the
plastic components total $4.50 per handisaw.
3,300
3,100
2,500
Manufacturing overhead for this product includes $73,800 annual fixed overhead (based on production of 27,000 units) and $1.20 per
unit variable manufacturing overhead. Wesley's selling expenses are 7 percent of sales dollars, and administrative expenses are fixed
at $18,000 per month.
Required:
Compute the following for the first quarter:
Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar.
1. Budgeted Sales Revenue
2. Budgeted Production in Units
3. Budgeted Cost of Direct Materials Purchases for the Plastic Housings
4. Budgeted Direct Labor Cost
$
$
January
88,400
2,650
$
38,160 $
February
95,200 $
2,925
42,120 $
1st Quarter total
112,200 $
295,800
3,250
8,825
0
127,080
March
$
46,800 $
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